Why The Entertainment Business Needs a Reboot

I was just in an interesting situation that reminded me why this business needs a reboot or will fail.  We sold to a network an animated tv idea that “had the potential to be the next Simpsons” (the network’s quote).

Excitement! Bubbly champagne! Celebration!

Now here is what actually happened: We sold the project with the attachment of a production company that had a deal at - let’s call it Studio A.  But we sold the project to a network that only wants to work with the network’s own in-house studio — let’s call it Studio B.

Now this network told us that Studio A had to partner with Studio B or the deal couldn’t be done.  Of course Studio A had never before partnered with Studio B on an animated project.  And rather than figuring out a deal that would make everyone happy — neither side could come to an agreement so the deal fall apart!

Which to me seems crazy.  Because in this marketplace why let go a great project that has the potential to make, literally, billions of dollars. Wouldn’t it be better to find a solution that works for everyone instead of just walking away from an amazing project?

Apparently not…

Clearly, this is another example of how it is extremely important to think outside the studio system in order to put projects together and actually have these projects see the light of day. If you rely on the studio system — you are liable to work hard on a project and even be lucky enough to sell it — and still never see it come to fruition!

So get creative when you are working on a project and think of several ideas on how to sell it!

Finding Film Production Money Outside the Studio System

As the studio system shrinks and the studios have less and less money for film production  — Sony stopped buying in October — more and more people are going outside the studio system to find investors and they are having success with this strategy!

For example, I just read a great article in the November 16th Wall Street Journal by Lauren A. E. Schuker about Sarah Siegel-Magness and her husband Gary Magness, a pair of novice film investors who put up roughly $12 million to finance PRECIOUS directed by Lee Daniels.

It is a dark movie about an overweight African-American teenager dealing with incest.  No studio was going to touch this movie with a 10-foot pole.  Yet the producers cold called Sarah Magness, who runs her own clothing company, and convinced her to invest in director Lee Daniels (who produced MONSTERS BALL and earned an Oscar for Halle Berry).

Now with Tyler Perry and Oprah Winfrey promoting the story there are projections that the film could make $25million or $50 million.  That is a huge return! (You can read the article at http://bit.ly/4AvdYh)

There are countless examples like this.  In fact, another top-grossing film that is out right now did more than $50 million on a very small production budget. PARANORMAL ACTIVITY was made for $11,000 and grossed over $61 million in 31 days!

These successes just go to show you that you don’t need to wait around to get your movie made.  You can go out and find the money to make your film now!

P.S. If you want to hear more about independent film financing, come hear me speak at Ascent-Hollywood this Wednesday, November 18th, at 6 p.m. FilmIndustryBloggers.com members get a discount!  Register at http://nov09-ascent-hollywood.eventbrite.com now to reserve your space and pay at the door where you’ll get your discount off the $15 fee.

Discount for FilmIndustryBloggers.com Members for Ascent-Hollywood Event!

Join e-Scension.com at

e-Scension.com Sign-Up

to get a $5 discount off admission for FilmIndustryBloggers.com members. Discounts taken at Door.

 

Our featured guests for this month’s event:

Rachel Miller

Talent Manager

Tom Sawyer Entertainment & ShowMeTheScreenplay.com (IMDB)

&

Simon Lamb

Entertainment Attorney

SRL Law, A Professional Corporation

Rachel & Simon have been doing joint presentations on the art and science of independent film finance, distribution, and sales at film festivals all over the world during the last several months, and have agreed to recreate this presentation for our audience.

 

Please join us in thanking our new Hosts:

 

Capitol City Lounge

featuring a private patio & bar with

Happy Hour Drink specials and tray passed apps from 6:00 pm - 7:00 pm

 

 

1615 N. Cahuenga Blvd.

Hollywood, CA  90028 http://www.capcitysports.com

Wednesday, November 18th 

$15 - Flat Rate

$50- VIP Experience (Not offered this month.)

6:00 PM - 7:00 PM - General networking

7:00 PM - 7:30 PM - Featured guests presentations

7:30 PM - 9:00 PM - More Mixing, Networking

 

RAFFLE DRAWINGS THRU-OUT NIGHT FOR:

`Free Final Draft 8.0 software

`Free $1,500 scholarship to Video Symphony

`Free Deluxe Accomodation 1-Night stay at San Francisco’s Hotel Triton on Union Square

 

General Notes of importance:

~ Valet Parking is available for $8 after 6 PM

~ Self-parking is available in lots immediately south of Capitol City at 1639 N. Cahuenga or any of the

local parking lots off Hollywood Blvd.

~ Street parking is available after 8 pm for free of charge at all metered spaces, or for $1.00 per hour

before 8 pm

~ Easy access to mass transit Lines 2, 4, 156, 212, 217, 302, 704, or 780, DASH (Hollywood &Vine) and Metro Red Line (Hollywood & Vine)

 

*Ascent-Hollywood is presented in association with e-Scension.com and monthly presenting sponsors.

The Los Angeles Times Actually Gets It Right….

I love this article from the Los Angeles Times…. every executive in town should read this. The short summary: Take Risk, Take Risk, Take Risk!

___________________________________________________________________________

The Big Picture

Patrick Goldstein on the collision of entertainment, media and pop culture

Is Hollywood always in panic mode? Ari Emanuel’s history lesson

November 2, 2009 |  6:11 pm

If you’ve been reading the gloom and doom stories in the press lately, you know that Hollywood is going through its fair share of belt tightening. Unsure about future profits, studios have been cutting back on everything including movie production budgets, A-list stars’ first-dollar gross deals and perk packages, as well as movie premieres, screenwriter salaries and — oh, yes — newspaper advertising.

It’s all been a big bummer, especially for the town’s talent agents, who have had to weather a thousand-and-one grumpy phone calls from top actors and filmmakers unhappy about seeing their once-reliable salary quotes being tossed out the window.

It’s nervous time for talent, especially with the studios crowing that most of their biggest hits this year (”The Hangover,” “Star Trek,” “Transformers”) have come without the presence of any big-name above-the-line talent.

But guess what? This ain’t the first time that Hollywood has tried to get tough and dump all that expensive talent baggage. That’s the message that WME boss Ari Emanuel delivered to his troops recently, sending out to all his agents a copy of a 1970 Life magazine that detailed Paramount Pictures’ efforts to revamp its business by jettisoning most of its costly star talent.

Even though 1969 was a banner year for movies, seeing the release of such groundbreaking films as “Midnight Cowboy,” “Easy Rider,” “The Wild Bunch” and ”Butch Cassidy and the Sundance Kid,” to name just a few, it was a lousy year for the studio bottom line. In the fall of 1969, Paramount had laid off 150 employees. As Life pointed out in its story, at the same time as Paramount was cutting overhead and writing down its production losses, Warner Bros. had $59 million in losses, MGM had $53 million in losses and Fox had $67 million in losses, all in an era where a million really meant a million.

Paramount’s parent company, Gulf + Western, which had acquired the studio in 1966, was run by the mercurial Charles Bluhdorn, a brilliant financier with big, square Chiclet-like teeth who had such large holdings in the Dominican Republic that he had his own private landing strip for his Gulfstream jet. Always willing to push the limits in search of a killer deal — he was under investigation by the SEC for much of the 1970s — Bluhdorn had little patience for the vagaries of the movie business. When films would lose money, he’d pound the table, bellowing in a guttural Austrian accent: “While we’ve been sitting here, I made more [expletive] money on sugar than Paramount made all year!”

You can imagine any number of top GE executives saying the same thing about Universal Pictures this year, if you simply replaced sugar with light bulbs or jet engines. Forty years ago, people were just as frustrated by the excess and unpredictability of the movie business as they are today. Emanuel wouldn’t get on the phone with me to explain exactly why he focused on this Life story, but one of his agents, who sent it along to me, said that Ari’s point was simple enough: Don’t overreact to the current studio cost-cutting frenzy. As this story makes all too clear, the more things change, the more things stay the same. Studios always think they can make the movie business into a more rational enterprise, but that’s a bean-counter fantasy. Making movies will always require a leap of faith.

It’s almost comical reading Bluhdorn grouse about his economic woes, knowing that he was voicing the exact same complaints echoed by the overlords of News Corp., Viacom, GE and Time Warner today. All you have to do is add a zero and his beefs are in perfect sync with today’s studio’s economic grumbling. “This paying stars $1 million against 10% of the gross — paying directors $500,000 — that’s nothing less than insanity,” he told Life. “You see, to recoup you must take in $3 million at the box office for every million up front. And for these expensive movies, the odds against recouping are enormous.”

Just as today’s studio chiefs think that they can now make “Transformers” and “Hangover”-style hits without movie stars, Bluhdorn was convinced that high-priced talent was superfluous. “You get from these big stars a document of conditions of how many hours they’ll work, what they’ll do and won’t do…. Well, who needs them? With today’s young audiences, names won’t sell a picture anymore. A great script and a devoted director — that’s what makes things happen.”

Substitute “special effects” for ”script” and you could easily slip those words into any of today’s studio bosses’ mouths. So why didn’t cost-cutting formulas take hold? Why did Bluhdorn’s resolve weaken? Will the same thing happen today? Keep reading:

Despite the similarities between today and 1969, it’s important to recognize that Hollywood was a very different place at the end of the 1960s. As late as 1965, the original moguls were still in control of most of the studios, but they were fading old men who no longer had any feel for the emerging youth culture. Jack Warner loathed “Bonnie and Clyde.” If it wasn’t for Warren Beatty’s sheer persistence, the studio would’ve buried it. When Bluhdorn brought Robert Evans in as a production exec in the late ’60s, he told him, “The Paramount [dolt] in charge now is 90 years old. He saw ‘Alfie’ and he couldn’t even hear it.”

The studios didn’t have all the ancillary revenue streams they have today — they largely lived or died by the theatrical performance of their films. But they lost money the same way people lose money today — by trying to do knockoffs of past successes instead of embracing something new. Even though 1969 was a heady year of creative breakthroughs, the studios were still reeling from the failures of the mid-’60s when, encouraged by the huge success of musicals like “My Fair Lady,” “Mary Poppins” and “The Sound of Music,” they nearly went broke producing such epic failures as “Dr. Dolittle,” “Paint Your Wagon” and “Hello, Dolly!”

“Musicals were the tentpole movies of their day and everyone thought that if one was a hit that you could just churn out more of them and rake in the money,” recalls Dick Zanuck, still one of the industry’s top producers, who was head of production at Fox for most of the ’60s. Fox had nearly been bankrupted by “Cleopatra,” a disastrous 1963 flop that audiences spurned, despite the presence of Elizabeth Taylor and Richard Burton, two of the biggest stars of the day.

Zanuck says Fox was so broke when he arrived in the early ’60s that “we had to close the studio for four months. Most of the employees were laid off, the commissary was shut down.” By the late ’60s, most rival studios were in just as poor condition. When Francis Ford Coppola was making ”The Rain People,” one of his first films, at Warner Bros. in the late ’60s, he recalled being amazed by how empty the back lot was. “It was like a ghost town,” he told me years afterward.

What finally got the studios back in business, as the ’60s ended and the ’70s began, was something in short supply today — a willingness to take risks on new filmmakers and adventuresome material. Bluhdorn was ridiculed for hiring the handsome young Evans — a man with dazzling white teeth and a permanent tan — to run Paramount. Evans had so little experience, having come from the shmatte business, that the town assumed that Evans was sleeping with either Bluhdorn or his wife, Yvette, who’d recommended Evans to her husband as executive material since he was such a ”gorgeous” guy.

Evans was colorful and erratic — he certainly wasn’t like the cautious, buttoned-down marketing execs that get the call to run studios today. But he had a keen eye for talent. By the mid-1970s, relying on Evans’ often spontaneous creative hunches, Paramount had enjoyed one of the most remarkable runs in the annals of the business, releasing such cinematic gems as “The Godfather” and its sequel,  as well as “Serpico,” “The Conversation,” “Chinatown,” “Nashville” and “Paper Moon.”

The best movies, with rare exceptions, weren’t the most expensive ones. They certainly weren’t the films that tested well with research audiences. They weren’t remakes. They were diamonds in the rough, made fast and cheap by talent with something to prove. One of the most profitable movies Zanuck made at Fox was a war film with two little-known newcomers and a director who’d been laboring for years in obscurity, doing episodic TV. It was called “MASH.”

To Zanuck, it was as unlikely a hit as last year’s breakthrough ”Slumdog Millionaire.” ”It was just a hunch,” he recalls. “I loved the script, by Ring Lardner Jr., but all sorts of well-known directors turned it down. No one had heard of Robert Altman at all — he was still shooting ‘Combat’ TV episodes. But it only cost $1.5 million and it felt fresh.”

Zanuck refused to spend a penny more. All the war-zone scenes were filmed at Fox’s studio ranch in Malibu Canyon. When Altman initially insisted that the film, for authenticity purposes, had to be shot in Korea, Zanuck found a bunch of pictures of rural Korea and a bunch of pictures of Fox’s ranch. “I told him if he could tell which was which, he could go to Korea, but he couldn’t tell the difference,” Zanuck recalls. “So he had to stay here. When he needed to shoot the golf scenes [set] in Japan, I told him to put a couple of caddies in kimonos and shoot it across the street [from Fox] at Rancho Park.”

If Ari really wants to buck up his troops, he should have Zanuck stop by the agency and tell some more ”MASH” stories, which only serve to remind us that hit movies don’t come off a sequel assembly line. Hit movies are born out of ingenuity and raw creativity. The studio bosses can try, as they are today and as they did 40 years ago, to slash costs and squeeze blood from a turnip. But if they rely on retreads instead of embracing originality, they will find themselves with a new generation of “Cleopatras” and “Dr. Dolittles” on their hands.

” ‘MASH’ worked for the same reason that ‘Slumdog Millionaire’ or ‘Juno’ or ‘The Hangover” worked today; it was irreverent, inexpensive and it was in sync with the culture,” says Zanuck. “It was a discovery and I’ve been around long enough to know that if there’s anything audiences love, it’s to discover something new.”